Homework Help is Here – Start Your Trial Now!
Math
Probability
In a large casino, the house wins on one of its games with a probability of 51%. 1:1, meaning that if you win, you gain the amount you bet; if you lose, you lose What is the expected value to the player of betting $1?

In a large casino, the house wins on one of its games with a probability of 51%. 1:1, meaning that if you win, you gain the amount you bet; if you lose, you lose What is the expected value to the player of betting $1?

Holt Mcdougal Larson Pre-algebra: Student Edition 2012
Holt Mcdougal Larson Pre-algebra: Student Edition 2012
1st Edition
ISBN:9780547587776
Author:HOLT MCDOUGAL
Publisher:HOLT MCDOUGAL
Chapter11: Data Analysis And Probability
Section11.8: Probabilities Of Disjoint And Overlapping Events
Problem 2C
See similar textbooks
icon
Related questions
Question
Q1
1. In a large casino, the house wins on one of its games with a probability of 51%. All bets in the game are 1:1, meaning that if you win, you gain the amount you bet; if you lose, you lose the amount you bet. What is the expected value to the player of betting $1? 2. Suppose a charitable organization decides to raise money by raffling a trip worth $500. If 3,000 tickets are sold at $1.00 each, find the expected net winnings for a person who buys 1 ticket. 3. An insurance policy sells for $720. Based on past data, an average of 1 in 70 policyholders will file a $10,000 claim, an average of 1 in 100 policyholders will file a $20,000 claim, and an average of 1 in 400 policyholders will file a $50,000 claim. (a) What is the expected value to the company per policy sold? (b) What is the expected profit of selling 100,000 policies?
Transcribed Image Text:1. In a large casino, the house wins on one of its games with a probability of 51%. All bets in the game are 1:1, meaning that if you win, you gain the amount you bet; if you lose, you lose the amount you bet. What is the expected value to the player of betting $1? 2. Suppose a charitable organization decides to raise money by raffling a trip worth $500. If 3,000 tickets are sold at $1.00 each, find the expected net winnings for a person who buys 1 ticket. 3. An insurance policy sells for $720. Based on past data, an average of 1 in 70 policyholders will file a $10,000 claim, an average of 1 in 100 policyholders will file a $20,000 claim, and an average of 1 in 400 policyholders will file a $50,000 claim. (a) What is the expected value to the company per policy sold? (b) What is the expected profit of selling 100,000 policies?
Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 3 steps

SEE SOLUTIONCheck out a sample Q&A here
Blurred answer
Recommended textbooks for you
Holt Mcdougal Larson Pre-algebra: Student Edition…
Holt Mcdougal Larson Pre-algebra: Student Edition…
Algebra
ISBN:
9780547587776
Author:
HOLT MCDOUGAL
Publisher:
HOLT MCDOUGAL
College Algebra
College Algebra
Algebra
ISBN:
9781305115545
Author:
James Stewart, Lothar Redlin, Saleem Watson
Publisher:
Cengage Learning
SEE MORE TEXTBOOKS